HOUSE AMENDED
PRIOR PRINTER'S NOS. 791, 2416, 2499 PRINTER'S NO. 2562
No. 728 Session of 1993
INTRODUCED BY MADIGAN, STAPLETON, WENGER, HELFRICK, BELAN,
ROBBINS, MUSTO, REIBMAN, JUBELIRER, MOWERY AND RHOADES,
MARCH 26, 1993
AS RE-REPORTED FROM COMMITTEE ON APPROPRIATIONS, HOUSE OF
REPRESENTATIVES, AS AMENDED, NOVEMBER 22, 1994
AN ACT
1 Providing for the implementation of a loan program for farmers
2 adopting certain specialized agricultural practices.
3 The General Assembly of the Commonwealth of Pennsylvania
4 hereby enacts as follows:
5 Section 1. Short title.
6 This act shall be known and may be cited as the Agriculture-
7 Linked Investment Program.
8 Section 2. Legislative intent.
9 It is the intent of the General Assembly that farmers be
10 offered an incentive to encourage the adoption of agricultural
11 best management practices as a part of a nutrient management
12 plan, to prevent nutrients from washing off fields and entering
13 streams and to prevent soil erosion. These incentives shall take
14 the form of low-interest capital in exchange for the adoption of
15 a nutrient management plan.
16 Section 3. Definitions.
1 The following words and phrases when used in this act shall
2 have the meanings given to them in this section unless the
3 context clearly indicates otherwise:
4 "Best management practices." Specialized practices designed <--
5 to control erosion, control runoff, establish vegetation and
6 manage nutrient animal wastes and fertilizers or other practices
7 approved by the State Conservation Commission, an equivalent
8 agency or the United States Agriculture Stabilization and
9 Conservation Service. A PRACTICE OR COMBINATION OF PRACTICES <--
10 DETERMINED BY THE STATE CONSERVATION COMMISSION PURSUANT TO THE
11 ACT OF MAY 20, 1993 (P.L.12, NO.6), KNOWN AS THE NUTRIENT
12 MANAGEMENT ACT, TO BE EFFECTIVE AND PRACTICABLE (GIVEN
13 TECHNOLOGICAL, ECONOMIC AND INSTITUTIONAL CONSIDERATIONS) TO
14 MANAGE NUTRIENTS TO PROTECT SURFACE AND GROUNDWATER TAKING INTO
15 ACCOUNT APPLICABLE NUTRIENT REQUIREMENTS FOR CROP UTILIZATION.
16 BEST MANAGEMENT PRACTICES SHALL INCLUDE, BUT NOT BE LIMITED TO:
17 (1) CONSERVATION TILLAGE.
18 (2) CROP ROTATION.
19 (3) SOIL TESTING.
20 (4) MANURE TESTING.
21 (5) DIVERSIONS.
22 (6) MANURE STORAGE FACILITIES.
23 (7) STORM WATER MANAGEMENT PRACTICES.
24 (8) NUTRIENT APPLICATION.
25 "Eligible borrower." A Commonwealth farmer who adopts best <--
26 management practices, as evidenced by a nutrient management
27 plan.
28 "ELIGIBLE BORROWER." ANY PERSON WHO IS DOMICILED IN THIS <--
29 COMMONWEALTH, WHO ENGAGES IN AGRICULTURAL OPERATION IN THIS
30 COMMONWEALTH AND WHO IS A CONCENTRATED ANIMAL OPERATION PURSUANT
19930S0728B2562 - 2 -
1 TO THE ACT OF MAY 20, 1993 (P.L.12, NO.6), KNOWN AS THE NUTRIENT
2 MANAGEMENT ACT.
3 "LENDING INSTITUTION." ANY FINANCIAL INSTITUTION THAT IS
4 AUTHORIZED TO ISSUE COMMERCIAL LOANS, IS A STATE DEPOSITORY
5 APPROVED BY THE BOARD OF FINANCE AND REVENUE AND ENTERS INTO AN
6 AGREEMENT WITH THE TREASURY DEPARTMENT FOR PARTICIPATION IN THE
7 AGRICULTURE-LINKED INVESTMENT PROGRAM.
8 "Nutrient management plan." A system of best management <--
9 practices to prevent the pollution of surface waters and
10 groundwater by addressing the most critical farm nutrient
11 problems through measures to manage fertilizers and animal
12 wastes and to reduce soil erosion.
13 Section 4. Implementation.
14 The procedures applicable to the Agriculture-Linked
15 "NUTRIENT MANAGEMENT PLAN." A WRITTEN SITE-SPECIFIC PLAN <--
16 WHICH INCORPORATES BEST MANAGEMENT PRACTICES TO MANAGE THE USE
17 OF PLANT NUTRIENTS FOR CROP PRODUCTION AND WATER QUALITY
18 PROTECTION CONSISTENT WITH THE CRITERIA ESTABLISHED PURSUANT TO
19 THE ACT OF MAY 20, 1993 (P.L.12, NO.6), KNOWN AS THE NUTRIENT
20 MANAGEMENT ACT.
21 SECTION 4. AGRICULTURE-LINKED INVESTMENT PROGRAM; ELIGIBILITY
22 AND IMPLEMENTATION.
23 (A) ELIGIBILITY.--OPERATORS OF CONCENTRATED ANIMAL
24 OPERATIONS WHICH ARE REQUIRED TO DEVELOP AND IMPLEMENT NUTRIENT <--
25 MANAGEMENT PLANS PURSUANT TO SECTION 6 OF THE ACT OF MAY 20, <--
26 1993 (P.L.12, NO.6), KNOWN AS THE NUTRIENT MANAGEMENT ACT, SHALL
27 BE ELIGIBLE FOR AN AGRICULTURE-LINKED INVESTMENT LOAN UNDER THIS
28 ACT. PRIORITY FOR SUCH LOAN ASSISTANCE, HOWEVER, SHALL BE GIVEN <--
29 TO THOSE OPERATORS OF CONCENTRATED ANIMAL OPERATIONS WHO
30 PURSUANT TO SECTION 6(G) OF THE NUTRIENT MANAGEMENT ACT HAVE
19930S0728B2562 - 3 -
1 BEEN GRANTED AN EXTENSION BY THE STATE CONSERVATION COMMISSION
2 TO IMPLEMENT AN APPROVED NUTRIENT MANAGEMENT PLAN. DOCUMENTATION
3 THAT A NUTRIENT MANAGEMENT PLAN HAS BEEN APPROVED FOR
4 IMPLEMENTATION SHALL BE SUBMITTED WITH AN APPLICATION FOR AN
5 AGRICULTURE-LINKED INVESTMENT LOAN. IN NO CASE SHALL THE STATE
6 TREASURER APPROVE AN APPLICATION FOR A LOAN UNDER THIS ACT UNTIL
7 THE DOCUMENTATION REQUIRED UNDER THIS SUBSECTION IS RECEIVED.
8 (B) IMPLEMENTATION OF PROGRAM.--THE PROCEDURES APPLICABLE TO
9 THE AGRICULTURE-LINKED Investment Program are as follows:
10 (1) Lending institutions wishing to participate in this
11 program shall enter into an investment agreement with the
12 Commonwealth.
13 (2) A lending institution shall accept and review
14 applications for loans from eligible borrowers.
15 (3) The lending institution shall apply all usual
16 lending standards to determine the creditworthiness of each
17 eligible borrower.
18 (4) Upon its approval of an eligible borrower's loan
19 application, the lending institution shall submit the loan
20 application and approval to the State Treasurer.
21 (5) The State Treasurer shall review the application to
22 verify the borrower's eligibility.
23 (6) Upon determination of borrower eligibility, the
24 State Treasurer shall deposit, with the lending institution
25 in a savings account COLLATERALIZED CERTIFICATE OF DEPOSIT in <--
26 the name of the Commonwealth, funds sufficient to cover the
27 amount of the loan requested.
28 (7) The lending institution shall credit the
29 Commonwealth's account with appropriate interest earnings at
30 appropriate periods in accordance with rates established by
19930S0728B2562 - 4 -
1 the Board of Finance and Revenue.
2 (8) Funds loaned to an eligible borrower under this
3 program shall be charged an interest rate no higher than 3%
4 above the passbook savings account rate paid to the <--
5 Commonwealth on its passbook savings account RATE ESTABLISHED <--
6 PURSUANT TO PARAGRAPH (7).
7 (9) Under the terms of this act, lending institutions
8 which accept eligible borrowers shall allow borrowers to
9 borrow the entire amount of the loan at the outset or to
10 establish a line of credit with periodic withdrawals up to
11 the amount of the original loan.
12 (10) Loans shall not exceed $75,000 and shall be placed
13 for a maximum of a six-year 15-YEAR period. SEVEN YEAR <--
14 PERIOD, BUT NOTHING HEREIN SHALL PRECLUDE THE STATE TREASURER
15 AND A PARTICIPATING LENDING INSTITUTION FROM NEGOTIATING A
16 LOAN PERIOD FOR LESS THAN SEVEN YEARS.
17 (11) At the conclusion of the period of the eligible
18 borrower's loan, the initial deposit, together with interest
19 earned, shall be returned to the State Treasurer.
20 Section 5. Liability.
21 The Commonwealth and the State Treasurer shall not be liable
22 to a lending institution in any manner for payment of the
23 principal or interest on the loan made to an eligible borrower.
24 Any delay in payments or default on the part of the eligible
25 borrower shall not in any manner affect the deposit agreement
26 between the lending institution and the State Treasurer.
27 SECTION 6. FUNDING CAP. <--
28 THE AGGREGATE AMOUNT OF AGRICULTURE-LINKED INVESTMENT LOANS
29 ISSUED UNDER THIS ACT SHALL NOT EXCEED $25,000,000 OUTSTANDING
30 AT ANY ONE TIME.
19930S0728B2562 - 5 -
1 Section 6 7. Effective date. <--
2 This act shall take effect in 60 days JULY 1, 1995. <--
A15L03SFG/19930S0728B2562 - 6 -